Japan’s mining and energy conglomerate JXTG Holdings Inc., the majority owner of Chile’s Caserones copper mine, is said to be studying the sale of the operation, in a deal that could fetch about $1 billion.
According to The Wall Street Journal, the urge for offload the asset comes amid expectations of rising copper prices, driven in part by a lack of investment in new mines and soaring demand for electric vehicles (Evs), which use twice as much copper as internal combustion engines.
Asked about the report by Reuters, however, JX Nippon Mining — the metal unit of JXTG Holdings — declined to comment, adding it was not something that has already been decided.
The mine, behind schedule ever since it began producing in May 2014, has been affected by a series of technical problems in its ramp-up phase, costing its owners hefty impairment charges.
Caserones has become a source of worries for its owners, which include Mitsui Mining & Smelting and Mitsui & Co. The copper mine, behind schedule ever since it began producing in May 2014, has not only been affected by a series of technical problems in its ramp-up phase, but it has also cost the Japan-based miners hefty impairment charges.
The operation’s expected annual production still falls short of the 150,000 tonnes target intended when construction of the mine began. On top of that, operator Minera Lumina Copper Chile (MLCC) is currently facing fines of up to $54.8 million for infractions to the provisions established in its mining permit.
Chile’s Superintendency of the Environment (SMA) also went after Lumina in 2015, ordering it to pay $11.9 million for breaching environmental rules. At the time, it was the second-highest fine the SMA had imposed since it was created in 2012.
The largest penalty until then — $16 million — was issued in 2013 to Barrick Gold’s now shuttered Pascua Lama gold and silver mine.
Caserones is located at an altitude of 4,200m to 4,600m above sea-level in the Atacama Desert, close to the border with Argentina.
Copper concentrate output from the operation totalled 136,500 tonnes last year. That’s equivalent to just 2.3% of Chile’s total annual output in 2018, which stood at 5.83 million tonnes — its largest volume ever.
The post Japanese owner of Chile’s Caserones copper mine said to be mulling sale appeared first on MINING.com.